Bank of America, Key Bank, Merrill Lynch, and Morgan Stanley are scheduled to close The Timken Company's $875 million line by Thursday. The line backs the Canton, Ohio, bearing manufacturer's $840 million purchase of Ingersoll-Rand's Torrington subsidiary. Bankers familiar with the deal said BANK ONE has signed onto the five-year, $500 million revolver as co-documentation agent with a $50 million ticket. The credit also includes a $375 million, 364-day revolving bridge-to-bond piece, with both tranches priced at LIBOR plus 11/ 2%. The BANK ONE commitment was the only one that could be confirmed and officials at the banks either declined to comment or did not return calls. It could not be determined whether the loan is underwritten.
One banker pointed to snags with the credit. "The company is in a cyclical industry, which can be difficult in a recession," said the banker, who was considering investing in the facility. He added that the company has improved since posting losses in past years, but the risk/reward levels still might not pan out. Glenn Eisenberg, cfo of Timken, could not be reached.